  |
|
home news banks cultural criminal dipcourier products subscribe |
OUSTING OR PEACEFUL CO-EXISTENCE?
Already today one can see that the efforts of CB and commercial bank experts are leading ArCa development in right direction. It was really wise to introduce ArCa before international giants could appear in Armenia. But to establish "good neighborhood" with Visa and MasterCard one should find out if they have any requirements to the local banks, if they might set strict certification and business-plan development rules and if this might not automatically oust the banks from the ArCa market. Their growth plans give real grounds for concern. Visa is planning to issue 100,000 cards in Armenia by 2005 and unless local cards are armed with necessary and convenient services they will certainly be forced out of the market. This problem should concern first of all the banks who are simultaneously members to ArCa and international systems. They should start promoting ArCa instead of catering for Visa or MasterCard just to raise their image. The same is for the banks seeking to join the international systems. After all they should know that the Armenian market little room for international cards. The potential clientele is estimated at 15,000-20,000 holders. This number would pay off and give profit provided that the card holders were distributed among 3-4 banks. But today the picture is quite different - as many as 11 banks work with Visa and MasterCard. Low demand and strong competition make it almost impossible for them to recoup their expenses. Moreover, some of the banks issue cards just to ensure symbolic emission volume but in fact most of the cards are inoperative. To avoid undesirable problems the Armenian banks should enlarge their local card services and to make Armenian and international cards "good neighbors." This implies joint projects rather than simultaneous issue. For example, from the very first day of its MasterCard membership Armenian Development Bank (ADB) has been promoting both local and international cards. ADB is the only Armenian bank offering ArCa to international card holders. When receiving a MasterCard Gold or a MasterCard Business a client is granted an ArCa Gold or ArCa Business respectively. These cards give larger credit and medical insurance opportunities - up to $30,000. Beside, ADB has a universal card Cirrius/Maestro - in Armenia it can be used as a local abroad as an international card. ADB has developed a package of interesting programs to ensure best convenience for ArCa clients. Together with Armeconom the bank has designed software allowing ArCa holders to use their cards to pay bills, to buy Arminco internet cards and to replenish the accounts of Easy-Card cellular communication package. ADB is shortly planning to provide salary ArCa holders with an overdraft up to 50,000 AMD for urgent needs: for buying foodstuffs and paying bills. This will help mostly budgetary employees who get salaries with months' delay. The head of the bank's plastic card department Gagik Shahinyan says that it's high time to use local cards in consumer crediting. The bank is presently drafting a program to open ArC overdrafts up to 600,000 AMD ($1,000) with 18%-22% yearly interest. This program is expected to significantly encourage retail crediting. It's up to the client to choose where to go shopping. Unlike the classical consumer crediting he is not obliged to adjust himself to the bank-shop credit relations schemes. Only together will the Armenian commercial banks be able to raise the advantages of ArCa. And some of them are already doing this quite well. As a result, if earlier experts forecast 25,000 ArCa holders in 2004 now the level has been raised to 50,000. This is a very good prerequisite for preserving the position of the Armenian cards on the Armenian market. Karina Melikyan, ARMINFO, 7 April, 2004 |
This question arose after the two bitter rivals of the world plastic
card market Visa and MasterCard came to Armenia. True, none of them
is yet planning to "oust" the local payment system ArCa but unless
appropriate steps are taken already today this danger may become
quite tangible in the very near future. Few people doubt it seeing
similar examples in many country including the huge Russia. The
Russian card systems are now facing a most serious crisis failing
competition with "the foreigners." The only counter-argument to this
"intervention" is planned work to introduce technologies and
innovations meeting international standards.
